COST REDUCTION
A Brand Point Management Perspective
Executive Summary
Companies that sell branded products and services often
pay lip service to cost-reduction measures but implement
them only when pushed, when difficult circumstances arise
and mandate decisive action. Even in good circumstances,
cost reduction is done hesitantly, with misgivings or in a
reactionary way.
But today’s extremely difficult economy makes cost reduction
initiatives imperative and provides all the justification a
company needs to undertake them. And fortunately, it creates
an opportunity to implement measures that take workflow
costs out of the budget permanently – measurements that
are as beneficial in a good economy as they are today.
This paper outlines views and solutions for cost reduction
and the potential for added benefits. Traditional cost
reduction initiatives have focused on reducing cost of
materials and cost of manpower. But many companies
have exhausted these methods, already having put as
much pressure on vendors as possible and having reduced
the cost of materials to the point of potentially affecting
the quality of the products and brands.
This calls for initiatives that may not be as intuitive and
obvious, or may seem complicated or difficult to implement
quickly or economically. The fact is, the initiatives
Schawk promotes are logical and practicable, and their
cost-reduction benefits are long-term – not stopgap.
These include reducing time and effort in creating and
delivering branded materials – what we call process-
based improvements – and the development of more
sophisticated, productive, integrated relationships with
best-of-breed service providers – what we call vendor-based
improvements.
A crucial point is that these measures are not merely – or
even primarily – cost reduction measures. They are ways to
improve the concepting, creation and maintenance of brand
materials while enhancing the delivery of compelling and
consistent brand experiences for consumers. And since these
measures are built on efficiency, simplicity and focus, they
are powerful cost-reduction initiatives, as well.
Schawk is a global company specializing in the creation,
execution and maintenance of brand materials and assets.
Our expertise in cost reduction is a natural part of our
delivery of brand point management, a category of service
that enables our clients to create compelling and consistent
brand experiences for their customers wherever they touch
the brand. In this paper, we will describe key opportunities for
cost reduction, and we will suggest how an organization can
quickly capture significant cost reduction through process-
based and vendor-based measures. And we will show
that while many of these concepts and ideas are strongly
interrelated, cost reduction is maximized when they are truly
integrated. Top-line revenues grow, too – which is the best
argument of all for cost-reduction initiatives done right.
 What benefits can be realized? Where are the opportunities for cost reduction?

For brands and branded materials, cost reduction can be
realized through:
Process-based improvements:
• By reducing complexity throughout the brand lifecycle
• By removing redundancies in processes and people
• By improving visibility all along the process
Vendor-based improvements:
• By leveraging best-of-breed vendor capabilities
Cost reduction opportunities can be found at every
stage of the brand lifecycle, from the earliest strategy to
final printing and fulfillment. This is because upstream
decisions affect execution downstream, and when
strategists and designers and premedia and printing
agents have collaborated in planning – and when they
share technologies designed to streamline and strengthen
the process – there is a cumulative permanent effect of
cost reduction. This integration is integral to brand point
management. Let’s consider the many opportunities for cost
reduction along the brand lifecycle.

• By expanding agency responsibilities across brand Process-based opportunities: reduce complexity,

touchpoints remove redundancy, improve visibility

The potential for cost reduction is considerable: As brand assets travel through the complex process from
ideation to design to production, many people – potentially
• Reduction of production cycle times by 25 percent and across many agencies – will work on them. And as brands
revision cycles by 50 percent push to expand globally, more facilities must coordinate
• Reduction of creative-to-print costs by as much as efforts and resources. Over time, bottlenecks develop
35 percent and create lengthy development schedules that make it
• Decrease of catastrophic errors by 95 percent difficult to see where there is waste and misappropriation
of resources. The demand to get new products to market
• Dramatic reduction in costs relating to shipping of proofs drives further inefficient use of resources on tasks that are
and transportation of finished materials redundant but are easily forgiven in the name of speed to
• Shortened production cycles and quicker time to market market. When brands, such as consumer products, execute
SKUs across a wide geography, the potential for pitfalls
2 And importantly, there are significant benefits that improve increases – but so do opportunites for workflow improvements
the quality and consistency of branded materials. These that save money and make money simultaneously.
COST SAVINGS A Brand Point Management Perspective

include:
Process-based cost reduction opportunities include:
• Improved communication and predictability of production
processes • Streamlining the communication flow and workflow
Managing the communication flow in-house – among
• Improvements in project reporting and ROI analysis
brand managers, procurement, legal and other
departments – and with vendor partners, across strategy,
design and execution (such as premedia and printing) –
requires stringent workflow processes to save time, avoid
expenses and eliminate costly errors.

The results were: For a major pharmaceutical company, we

Workflow Cost Reductions:
Schawk Examples
Cost reduction through better
workflows is a Schawk expertise. For
an iconic consumer soup brand, we
developed workflow processes that
spanned design, production art and
premedia, and we fully trained its
four strategic design partners to work
within the process.
• More brand consistency worldwide through
best-practices standards
• Measurable milestones that ensured the
brand was in control of its packaging
spend and getting optimum results from
each design partner at every stage
• Decreased time to market
• Cost reductions resulting from efficiencies
and the elimination of a substantial
amount of re-work
achieved 70 to 80 percent reductions in
production time of printed packaging
materials between design and printing. Four-
week processes became four-day processes.
And for a major toothpaste brand we
executed a redesign and reproducible product
standards across 20 markets worldwide,
saving substantial time and money by
creating a hierarchy for differences in inks,
substrates and cultural color nuances.
 • Faster access to definitive brand assets
In the course of a brand’s lifecycle, its assets – graphics,
creative copy, boilerplate, etc. – will be used and re-used
by countless people in-house and with partner agencies.
Considerable time and money can be saved when
definitive assets are logically stored and easily accessible
and don’t need to be re-created again and again. This
eliminates costly errors, as well.
• Reducing design/revision cycles and costs
Superior workflow processes ensure that designers
correctly execute on strategy, saving time and cost,
especially since upstream errors are especially costly
when discovered downstream. Similarly, when strategy
and creative work with an awareness of downstream
executional requirements, resources are saved and errors
are avoided. This is especially true where regionalized
materials have distinct creative and production demands. Vendor-based cost reduction opportunities include:
Graphics technologies, such as online proofing and 3D
imaging, also dramatically save time and cost. • Aggregating broad segments of the brand process
• Reducing production cycles and costs
Fortunes are lost each year on printed materials that are
substandard or contain branding violations and must be
redone. Also, even perfect materials are costly when bad
processes force overtime printing charges. Processes that
deliver artwork on time and ensure that inks, substrates
and printer capabilities have been taken into account,
save time and money.
3 • Increasing ability to measure process and results
Workflow analysis, campaign analysis and retail-
performance analysis – these track the efficacy of
COST SAVINGS A Brand Point Management Perspective
production processes and the ROI of branded materials in
the marketplace, leading to cost reduction, efficiency and
more confident decision-making.
PROCESS-BASED
OPPORTUNITIES. Reducing
time and effort in creating and
delivering branded materials COST-REDUCTION OPPORTUNITES
VENDOR-BASED
OPPORTUNITIES. Developing
more sophisticated, productive,
integrated relationships with
best-of-breed service providers
Vendor-based opportunities: leveraging best-of-
breed capabilities, expanding responsibilities
Large consumer-facing brands never “go it alone” where
the creation of the brand and its materials is concerned,
but the drive for cost-reduction in the current economic
climate encourages rethinking of traditional choices for
vendor partnerships. Schawk’s conviction is that a more
strategic use of vendors not only reduces costs, it can
significantly improve the quality and consistency of branded
materials and ensure that they are deployed with agility and
timeliness worldwide. And this conviction is based on proof
that in the creation of branded materials, the consolidation
of vendors does work where it matters most: in making the
brand experience for the consumer more compelling and
consistent, while driving cost reductions.
Not simply “outsourcing” but the purposeful aggregation
of tasks within a vendor that can streamline the process
without sacrificing quality; in fact, quality is improved
along with cost reduction when the vendor is both broad-
based in capabilities and expert in those tasks.
• Leveraging geographical advantages
No one doubts that it’s preferable to source necessary
goods and services more cheaply. But this in itself
is a daunting task. It requires the understanding
and balancing of several factors including, currency
fluctuations, labor rates, material costs, and freight/
shipping costs. And it requires a vendor with a large
geographical footprint.
• “Around-the-clock” processes executed globally
The production of brand assets such as packaging
involves hundreds of small steps that must be executed
in order; smart use of vendors allows these processes to
go on almost non-stop thanks to time-zone advantages.
And the more geographically diverse a single vendor is,
the more these processes are kept “in-house” within that
vendor. This also minimizes the number of “handoffs” of
materials among different entities, eliminating chances
for slowdowns, redundancies and errors.
The process-based and vendor-based cost reduction
opportunities described are proven to produce the cost
reductions that deliver immediate benefits today and
permanently. And while these opportunities may initially
seem obscure or daunting, further details – and examples
from Schawk’s own portfolio – will offer more proof.
 Process-based cost reduction: how it’s done
Technology is a crucial component in permanent cost
reduction. The broader marketplace context is key here. As
Deloitte noted in its report “2008 Industry Outlook: A Look
Around The Corner”:
Many companies stand at technology crossroads: they
have depreciated their existing IT investments and now
must invest for the future. However, many industries
lack the necessary funds to do this.
Compelling and
consistent brand And with so many IT challenges, some companies may balk
experiences can’t at investing in technology that appears focused on relatively
esoteric needs, such as graphics workflows or digital asset
happen – especially management. Enterprise technology is available that
on a global scale – manages all types of graphics-related needs; clients can
without technology purchase this technology outright or contract for it. Either
that links people, way, the technology proves essential – not esoteric – for
brands that truly want superior quality and consistency in
processes and their branded materials and are committed to efficiency,
regions. agility and cost reduction in the process. And it typically
pays for itself in one to two years.
Compelling and consistent brand experiences can’t
happen – especially on a global scale – without technology
that links people, processes and regions. Brand point
management (especially as Schawk delivers it), leverages
a wide range of technologies, including graphics lifecycle
4 management, (workflow management, digital asset
management, online proofing), retail-performance and
campaign-performance management software, printer-
COST SAVINGS A Brand Point Management Perspective
characteristic research and more.
Workflow management
Workflow management technology is crucial to effective
global branding and the key for significant cost reduction.
As digital files progress through the complex process from
design to printing, many people will work on them. Workflow
management software monitors that process, identifying
bottlenecks and slowdowns and encouraging the efficient
execution of repeatable tasks.
An additional benefit of computer networking technology
is online proofing, which allows all contributors in the
production of brand materials to proof definitive versions
of those materials online and for careful oversight of the
revision and approval process. The benefits include the
elimination of errors, accidents and lost files, as well as
time-savings and improved final products through more
focused attention to definitive versions. Clearly there are
savings of resources such as paper, ink and electricity, as
well as fuel in the delivery of proofs – and time.
Digital asset management
Digital asset management systems (such as Schawk’s
BLUE™), are especially valuable. They have been proven
to shave millions of dollars off annual marketing and
1. For more details, see the Schawk’s white paper, “Operational Efficiency: A Brand Point Management Perspective”
at http://www.schawk.com/insights-and-work/insights/white-papers.
production fees by giving all vendors and in-house
marketers and designers access to the same approved
brand assets, including logos, color and print specifications,
packaging requirements, creative and boilerplate copy
and more. In the past, these highly standardizable assets
have had to be reproduced over and over again – at
great expense – as brands expanded in products and
geographical scope and as they came under the care of
new agencies.
Today, digital asset management systems confer huge
benefits with respect to brand consistency, manpower,
sustainability, brand-theft deterrence, marketplace agility
and more. And performance software gives instant feedback
on the efficacy of marketing programs, which operationally
efficient companies can then act upon quickly and
decisively.
When the brand controls its assets this way and makes
them available in an efficient manner, it saves considerable
time and money over inferior “systems,” in which each
stage of the process (and each vendor) has its own non-
definitive set of brand elements and typically charges for
the work of finding and reproducing them each time they
are needed. Such reproductions can cost hundreds of
dollars each time, hundreds of times a year. But accessing
a definitive image on a brand-owned, networked system
can cost as little as a few minutes of employee time. Played
out over the globe – encompassing product launches and
revamps, advertising and promotional materials, multiple
regions, languages and agencies – the benefits are
enormous. And compelling and consistent brand messages
are much easier to produce.
The global perspective
The efficient repurposing of brand assets, described above,
is vital. But there are additional global considerations.
The difficult economy has made improving global workflow
and communication a top priority. As companies downsize,
individuals or single offices are tasked with oversight of
wider geographical regions, and companies are finding it
necessary to remove traditional barriers between offices
on different continents. This requires improvements in the
communication and monitoring of workflow elements and
the integration of people, processes and technology. Brands
– or a vendor with a wide footprint and expertise – can
facilitate global efficiency by articulating expectations and
providing “watchouts” for process flow and for technical
matters like substrates, inks, print specifications. No less
important are regional cultural sensitivities and regulatory
issues like taxes. These can be enormous stumbling blocks
if a company doesn’t have the processes to account for
differences while driving efficiencies simultaneously.
 Vendor-based cost reduction: how it’s done

Consolidation of vendors and outsourcing “Smart” globalization

Frequently there is resistance within a brand to The consolidation described above is taking place on a
consolidating vendors, as it typically means a temporary global scale. In its “2008 Industry Outlook: A Look Around
loss of “comfort” and, for some managers, a loss of The Corner,” Deloitte stated:
“ownership” of their segment of the brand lifecycle. There
is also a widespread perception that each of the many Today, U.S. companies are going to foreign countries
In this process lifecycle stages should be handled by a different, dedicated such as China and India to access new markets and
of “smart agency. And efforts toward all-in-one agencies in the past harness local talents to support worldwide innovation.
two decades have sometimes had mixed results. But the In this process of “smart globalization,” companies are
globalization,” integrating their previously separate sourcing, market
current economy calls for a reconsideration of consolidation,
companies are especially since more recent trends have shown that some and talent strategies to globalize more intelligently to
integrating kinds of agency consolidation bear fruit. optimize costs and manage risks.”
their previously A key element of smart globalization is to avoid over-
For instance, there are significant benefits in aggregating
separate sourcing, post-design operations under one roof globally. European reaching. Deloitte adds:
market and talent brands have embraced this fact, and the result has been
Companies may need to rationalize their expanded
strategies to a “decoupling” of these services from ad agencies, where
global footprints. Many firms initially located
globalize more they were traditionally rendered, and aggregation of them
operations in emerging markets because the
within stand-alone production agencies. The resulting
intelligently to cost reduction is clear: Schawk shaved between 20 and 30
governments there offered numerous incentives. In
optimize costs and some cases, however, market entry was premature –
percent off a major cosmetics brand’s production budget in
the necessary infrastructure was not in place and the
manage risks. Europe this way.
promised cost reduction was not being realized.
If the cost reductions outweigh the various “political”
These suggestions justify and encourage a strategy of
discomforts of consolidation of vendors, the same is true for
smart, strategic outsourcing according to a desired global
outsourcing, another potentially sensitive subject. Schawk
footprint. For branded materials, a globally integrated
is a leader in a sophisticated kind of outsourcing that puts
supplier of graphics services can work for its client literally
5 Schawk employees on-site at client locations. “On-site”
around the clock, eliminating downtime between stages. It
relationships are much more common in some countries
can source printing services close to materials and close
than others. And they can take many forms, ranging
COST SAVINGS A Brand Point Management Perspective

to the target consumer, eliminating time and costs – what

from pure consulting on workflow processes or brand
Schawk terms “strategic insourcing.”
management, to oversight of employees, to the physical
production of artwork. Schawk does all of these for dozens
of clients worldwide.

The takeaway: In an economy that has endured tremendous

shockwaves already, the discomforts of vendor consolidation
and outsourcing now seem minor, especially compared to
the potential for cost reduction, efficiency, brand quality
and profits.

Schawk delivers cost reductions for a major pharma

A major international pharmaceutical company needed to improve workflows for point-of-
sale and packaging for thousands of consumer-health SKUs, save cost and improve time
to market. Leveraging brand point management, Schawk replaced more than two-dozen
premedia suppliers and printers/converters by consolidating work at Schawk facilities on
three continents, under Schawk managers. Schawk drastically streamlined and improved
workflow and graphics-management processes as well as the printing/converting process,
improved time-to-market and packaging quality and accuracy, and consolidated its
client’s administrative tasks by unifying billing under one monthly invoice.
 For example, pharmaceutical branded materials can be
extremely complex today, with seven-color printing on
complex substrates such as blister-packs, all needing
to be compelling and consistent worldwide thanks to
the increased branding that supports prescription and
over-the-counter drugs. Furthermore, pharma packaging
must route through numerous closely audited steps at
accredited facilities. Responding to these requirements,
strategic insourcing minimizes costs and enables agility by
leveraging geographical advantages in currency exchange
rates, labor costs and production costs.

Smart globalization and the related process of strategic

insourcing boil down to these aims: utilizing talent pools
including low-cost labor when wise; driving best practices
across time zones, languages and cultural variations;
and “load-leveling” – efficiently matching resources with
needs – for clients.
Closed-loop fulfillment and custom pack-out
“Closed-loop” services can consolidate such elements as
premedia, printing and fulfillment of retailer promotional
materials under one roof, creating time and cost reduction
and allowing transportation resources to be focused on
the final delivery of products, not on intermediate stages.
Currently this process is benefiting retailers who operate
6 over huge geographical areas. “Custom pack-out” is one
important example of a closed-loop service, in which
promotional materials can be customized on a regional,
COST SAVINGS A Brand Point Management Perspective
Schawk saves retailer thousands a day
For a very large retail clothing chain, Schawk
analyzes data coming directly from the
retailer’s cash registers through its online
inventory management and tracking system.
When integrated with Schawk’s digital printing
capabilities, this enables each store to order and
obtain the right products at the right time. As few
as one or two pieces of targeted collateral can
be printed efficiently for a single store through
variable-data technology. Overall, the client can:
• Enter media schedules, then monitor budgets
and up-to-date fulfillment costs
• Manage active and upcoming workloads for

scheduling and tracking features

local or even store-by-store basis using precise data on
store sales performance. Both of these call for a high degree
of process and technology sophistication.
Summary
Cost reduction is crucial to businesses today, worldwide.
It’s not merely a good idea, but potentially a matter of life
or death for some brands. Cost reduction takes many forms,
but they fall under the basic categories of process-based
and vendor-based. The more all of these are integrated, the
more effective the measures are.
It is also true that while cost-reduction measures often
focus their efforts closer to the execution and maintenance
stages of a brand and its assets, these measures are most
effective when they’re planned early in the brand lifecycle,
during strategy and design. This kind of integration of
effort, across strategy, creative and execution, is at the
heart of Schawk’s delivery of brand point management.
• Minimize duplication of data entry
• Manage approvals effectively, giving up-to-
the-minute job status and financial outlay
This custom pack-out system replaced one
in which cash-register data was reported via
phone and manually collated and transmitted to
previous fulfillment vendors. The cost reduction
– not to mention advantages in agility, efficiency
and promotional effectiveness, are obvious. This
client reported that it lost up to $3,300 a day
in potential revenues under the old system, due
to incorrect or late promotional materials. In
fact, Schawk solved another nagging problem
for the client, designing special box labels that
alerted store staff to the arrival of time-sensitive
promotional materials and the date they were to
be deployed.

And in the case of Schawk, these measures all contribute

directly and purposefully to another crucial facet of brand
success: compelling and consistent brand experiences,
wherever a consumer touches a brand. Cost reduction is a
powerful feature of brand point management, and Schawk’s
specialty is the delivery of brand point management.
 Schawk, Inc., (NYSE:SGK), is a leading provider of brand point
management services, enabling companies of all sizes to connect
their brands with consumers to create deeper brand affinity. With a
global footprint of more than 48 offices, Schawk helps companies
create compelling and consistent brand experiences by providing
integrated strategic, creative and executional services across
brand touchpoints. Founded in 1953, Schawk is trusted by many
of the world’s leading organizations to help them achieve global
brand consistency. For more information about Schawk, visit
http://www.schawk.com.

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© 2009 Schawk, Inc. All Rights Reserved. No part of this work

may be reproduced in any form without written permission from
7 the copyright holder. Schawk is a registered trademark of Schawk,
Inc. The Schawk logo is a trademark of Schawk, Inc. BLUE is a
COST SAVINGS A Brand Point Management Perspective

trademark of Schawk, Inc.